There were 79,540 single-family homes and condominiums flipped across the country during the second quarter, representing 7.5% of all home sales — roughly one out of every 13 — from April through June, according to Attom’s Q2 2024 U.S. Home Flipping Report.
That’s down from 8.7% one quarter prior and 7.9% a year earlier. Much of the quarterly dip can be explained by seasonal patterns, as other types of home sales rise during the busy spring homebuying period, pushing the market share of home flips down. And while flipping is slightly down annually, returns remain on the rise, spelling good news for shrewd active home investors.
Nationwide, flippers typically earned a 30.4% profit before expenses on homes sold in the second quarter. Historically, that’s not great; the typical profit margin on second-quarter flips this year remained far below the peak returns (some 56.3%) seen in 2016. Attom noted that Q2’s returns were also within a range that could easily be offset by the various costs that flippers face, including renovation expenses, mortgage payments and property taxes.
But the second quarter’s margin was still up modestly from the first quarter of 2024 (when flippers earned a 29.2% profit before expenses) and from the second quarter of 2023 (when flippers received a 27.8% return). Moreover, Q2 marked the fourth time in five quarters that margins rose, following about a period from 2016 through 2022 of virtually continuous diminishing returns.
“The spring homebuying season of 2024 brought another sign of hope for home flippers that the rebound in fortunes that began for them last year was more than just a temporary thing,” said Attom CEO Rob Barber. “It’s not as if profits have shot through the roof and investors are riding a new wave of good times. Far from it, as they continue to struggle to benefit from the broader market boom. But the second-quarter numbers did show another step in the right direction.”
Notably, sale prices for home flips rose far less than home prices did on the whole during the second quarter. Median prices for all single-family homes and condos grew roughly 9% quarterly and 6% annually, per Attom’s data. The median for home flip resales, however, climbed just 2% both quarter over quarter and year over year. Fortunately for flippers, that was enough to trigger a moderate margin improvement, due largely to favorable price shifts between initial time of purchase to resale.
Barber said that market conditions appear promising for more profit growth on the horizon.
“With the market rising amid tight supplies of homes for sale around the country and falling interest rates, conditions appear ripe for more improvement over the rest of the year as long as prices don’t shoot up past what most buyers can afford.”
